RF's Financial News

Sunday, May 26, 2013

First off - I want to wish all of you
a very wonderful Memorial Day holiday.I
hope you spend it with friends, family, some good food and drink, and remember
those that sacrificed so that we can celebrate.

I received an email the other
evening: ”You say that the market gains are all because of Federal Reserve
money, but I've been reading that Companies are so flush with cash that they're
buying back their own stock and pushing prices higher. So what's the Fed have to do with it?”

There are many ways that Federal
Reserve funds make their way into stock prices. Currently The Ben Bernanke
is printing $85 Billion a month, and using it to buy up Treasuries and
Mortgaged Backed Securities (MBS’s). By
being the buyer of last resort, they have driven interest rates to virtually
zero. Buying up MBS’s does a couple of things:

-First, it
lets banks off the hook.A large portion
of the big meltdown was because banks got caught with junk mortgages.So, one of The Ben Bernanke's first jobs in
2009 was to relieve the poor banks from all those trashy MBS's. But, not only did the Fed buy them (freeing
the banks from deadbeat borrowers), they bought them at “par”.In other words, because there were so many garbage
loans, an entire purchase may have been worth 39 cents on the dollar, but the
Fed gave the banks the entire dollar.

-Secondly,
when The Ben Bernanke buys Treasuries (at $45B / month) it reduces interest
rates. It also hands money over to the
primary dealer banks.You see, Benji
just doesn’t walk down the hall in DC and buy Treasuries from the Treasury
Secretary. If he did that, the banks
wouldn’t get their cut.He buys them
thru the 18 Primary dealer banks so that they get their ‘processing fees.’

On one hand we have the banking
system taking in massive amounts of Fed cash, with no place to put it – so they
play cowboy in the market.And on the
other hand (due to the insanely artificially low interest rates) companies have
realized they have the perfect Ponzi scam to buy-back their own stock.

The market runs on ‘Earnings per
Share’ (EPS).Assuming you’ve increased
your profits / earnings as far as you can – the only way remaining to increase
‘earnings per share’ is to reduce the denominator – reduce the number of shares
outstanding.Back in 2007, companies
went on a buy back binge like never before – trying to keep the 2005 - 2007
market rally alive. Now (in 2013) they
are trying to exceed that buy-back binge. This year, big U.S. companies
have given the go-ahead for $286 billion of buy-backs, up 88% from the same
period last year.Currently, U.S.
companies (not counting banks and financial firms) have bought-back more than
$1 trillion of stock in the five years through 2012.

So companies are increasing their
EPS by buying back stock and therefore making the denominator (the float)
smaller.However, there is a catch.Companies are BORROWING the money to do
it.Why are corporations borrowing the
money – because interest rates are virtually at zero!So if Corporations couldn't borrow money for
free, they wouldn't be buying back stock. On top of that, the Fed's ZIRP (Zero Interest
Rate Policy) has allowed corporations to sell their own corporate bonds (for a
couple percent higher than treasuries) and take the proceeds and buy-back even
more stock.Virtually all of the
corporations announcing buy-backs are not using corporate savings to buy-back
stock, they're issuing debt.Corporations are not expanding, not hiring, not re-tooling – they are buying
back stock (to the tune of $3B/day) to goose their EPS.

None of this insanity could happen
without the Fed pushing a trillion dollars a year into the system. Corporations couldn’t be offering buy-backs if
interest rates were anywhere near normal (i.e. corporations wouldn’t want the
risk of trying to pay out 7 or 8% interest on a couple billion dollars.)
So, between handing the banks big bucks for MBS's and Treasuries, The Ben
Bernanke's interest rate policy has pushed companies into playing the "Get
it while it’s hot” game.

This is why just the rumor that the
Fed may taper off the juice, sent the market into spasms of selling this week. Imagine what happens when it really hits? No more buy-backs.Banks will have non-performing loans
again.Trading desks won’t have free
money to play with.This is why The Ben
Bernanke's so trapped in a box. If he
stops this insanity, we crash. If he
doesn't stop, the distortions become so huge, we implode from within.

Look at Japan. They've had to halt their bond market 9 times
in the past week. The Yen injections are
tossing their entire system into spasms, and it’s getting quite dangerous. The Central Bank currency wars are causing
distortions that are not easily fixed. When
Japan announced their big monetary push, their stock market gained 40% in just weeks.
That is not normal.It feels like each day the distortions are
bigger, and the feelings of panic grow stronger. So do the Boy Scout
thing – Be Prepared.

The Market...

Back in April ‘The Powers that Be’ arranged
a massive hit on Gold. The bullion banks
and the gold warehouses were critically short of inventory and needed to shake
people out of their gold holdings. I
said then – do NOT buy this dip, because if their first attempt didn't work
they will do it again.Sure enough after
the GLD bounced from a low of 130 on April 12th, it ran to 142.50. Then they stepped in again, and smacked it
right in the face, sending it down from 142.50 on May 8th, to 130.88 on Monday.

Prior to Monday, for 7 sessions the
GLD hovered around 142.50. Since then,
we have received at least a dozen absolutely lousy economic reports, from the Philly
Fed to the Durable Goods report.Logic dictates
that due to strong demand, bad economic news, and global unrest the metals
should have gone higher.But after
consolidating for 7 sessions the metals went down, because the Central banks
and Bullion banks wanted them to go down in order to increase physical selling.

Gold is currently being purchased by
anyone with big bucks, and that includes the Central Banks, Bullion Banks, and
people like George Soros.FYI: It was
widely reported that George Soros sold his GLD shares (the ETF that
‘presumably’ tracks to the price of Gold).But Mr. Soros didn’t ‘sell’ his GLD shares like I would sell my GLD
shares.Mr. Soros (the large player that
he is) sold/redeemed his GLD shares for physical gold.

This attack on the metals will
exhaust itself, and when it does I will be a buyer again.I feel the time is close, because the
physical demand has increased during this latest pull down. Don't forget, with paper assets you can manipulate
a market to conform to virtually any silly notion you want. But in the physical market, you need a live
buyer for every seller. Currently, there
are 4 buyers for every seller!

On Friday I ‘gambled’ and purchased a
small amount of DIA calls.Why do I call
it a ‘gamble’ rather than an investment?Because I did it for all the wrong reasons – none of which have anything
to do with ‘logic’ and ‘investing’.

-The
market has not experienced 3 consecutive down days this year.

-Fridays
ahead of a 3-day weekend have been green 70% of the time. And on this Friday (although we opened down
over 100 points) we finished a +8!

-And given
we come back on Tuesday, we haven’t experienced a down Tuesday in 2013.

Having said that, we’ve been set up
11 times this year for what appeared to be a correction, and the market just
pushed higher. One day that record will
fall, and I think the fall will be fast and furious. So, while seeing the
market run wild is fun, not many want to talk about what happens when it ends.

Tips:

We made some trades
this week, we sold out of:

-GS – in
at 157.00 – sold @ 162.14

-UA – in
at 60.19 – sold @ 64.20

-SBUX –
in at 60.70 – sold @ 64.70

-NSC –
in at 77.03 – sold @ 79.00

DS sent us a hint to watch CCJ going forward.Canada is the #2 supplier of uranium to the
world, and the largest supplier in Canada is Cameco
Corporation (CCJ). It’s one of
many companies that will ride the uranium bull.Cameco mines are responsible for about 14% of global uranium production.
It owns mines in Canada, the United
States and Kazakhstan – which collectively hold 465 million pounds of proven
reserves.

My currentshort-term holds are:

-SIL – in at 24.51 (currently 13.40) – no stop yet

-GLD (ETF for Gold) – in at 158.28, (currently 134.16) – no stop
($1,386.80 per physical ounce), AND

Expressed thoughts
proffered within the BARRONS REPORT, a Private and free weekly economic
newsletter, are those of noted entrepreneur, professor and author, RF
Culbertson, contributing sources and those he interviews. You can learn more and get your free
subscription by visiting: <http://rfcfinancialnews.blogspot.com>
.

Please write to <rfc@getabby.com>
to inform me of any reproductions, including when and where copy will be
reproduced. You may use in complete form or, if quoting in brief, reference
<rfcfinancialnews.blogspot.com>.

If you'd like to view
RF's actual stock trades - and see more of my thoughts - please feel free to
sign up as a Twitter follower - "taylorpamm"
is my handle.

If you'd like to see
RF in action - teaching people about investing - please feel free to view the
TED talk that he gave on Fearless Investing:http://www.youtube.com/watch?v=K2Z9I_6ciH0

To unsubscribe please
refer to the bottom of the email.

Views expressed are
provided for information purposes only and should not be construed in any way
as an offer, an endorsement, or inducement to invest and is not in any way a
testimony of, or associated with Mr. Culbertson's other firms or
associations. Mr.
Culbertson and related parties are not registered and licensed brokers. This message may contain information
that is confidential or privileged and is intended only for the individual or
entity named above and does not constitute an offer for or advice about any
alternative investment product. Such advice can only be made when accompanied
by a prospectus or similar offering document. Past performance is not indicative of
future performance. Please make sure to review important disclosures at the end
of each article.

Note: Joining BARRONS
REPORT is not an offering for any investment. It represents only the opinions
of RF Culbertson and Associates.

PAST RESULTS ARE NOT
INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY
FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING ALTERNATIVE
INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS
INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT
PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME
REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY
CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE INVESTMENT
MANAGER.

Alternative investment
performance can be volatile. An investor could lose all or a substantial amount
of his or her investment. Often, alternative investment fund and account
managers have total trading authority over their funds or accounts; the use of
a single advisor applying generally similar trading programs could mean lack of
diversification and, consequently, higher risk. There is often no secondary
market for an investor's interest in alternative investments, and none is expected
to develop.

All material presented
herein is believed to be reliable but we cannot attest to its accuracy.
Opinions expressed in these reports may change without prior notice. Culbertson
and/or the staff may or may not have investments in any funds cited above.

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>
Until next week – be safe.

Sunday, May 19, 2013

Mr. Sam Collins – a technical market
analyst for 45 years writes:“Never
in my over 45 years in the investment business have I seen such a lack of
enthusiasm for one of the biggest, boldest bull markets in history. Even the major institutions talk down the
potential for higher prices.”

Mr. Collins:

-Maybe
people aren't very enthusiastic about this market because the last two market
bubble crashes took all of their money?

-Maybe
they remember the late 90's where every analyst would come on CNBC and tell us stocks
could only go up, until (of course) the didn’t in March of 2000?

-Maybe
people got tired of Bank manipulations concerning housing, and they bought a
house for $500k in 2006 that was $79k in 2002 because the experts told them that
real estate can only go up, until (of course) it didn’t in 2007?

-Or just
maybe it's because CNBC has folks like Henry Blodget on, pushing stocks 24/7,
and you find out that people like Mr. Blodget have either been fined, or have
admitted financial misconduct.In 2002,
New York State Attorney General Eliot Spitzer, published Merrill Lynch e-mails
in which Mr. Blodget gave his actual assessments about stocks which conflicted
with what he was publicly publishing. In
2003, the U.S. Securities and Exchange Commission charged Mr. Blodget with
civil securities fraud. Mr. Blodget agreed
to a permanent ban from the securities industry and paid a $2 million fine plus
a $2 million disgorgement.

-But it gets better, Mr. Blodget (on CNBC on Friday)
was interviewing Charley Rangel.Mr.
Rangel (a member/chair of the House Ways and Means Committee) has been charged
5 times for Ethics violations, and has been tax delinquent for over 3 years.

So maybe, Mr. Collins, people aren't
racing toward stocks because on any given day we have a guy who paid $4 million
to the SEC to keep his story quiet, interviewing a powerful crook who happens
to be the U.S. Representative for New York's 13th congressional district on the
most well known Financial Station. (I can't make this stuff up!)And maybe, Mr. Collins, we should all just believe
The Ben Bernanke when he says:

-(2/15/2006)
"Housing markets are cooling a bit. Our expectation is that the decline in
activity or the slowing in activity will be moderate, that house prices will
probably continue to rise."

-(3/28/2007)
"At this juncture, the impact on the broader economy and financial markets
of the problems in the subprime market seems likely to be contained. In
particular, mortgages to prime borrowers and fixed-rate mortgages to all
classes of borrowers continue to perform well, with low rates of
delinquency."

-(1/10/2008)
"The Federal Reserve is not currently forecasting a recession." AND

(When
asked directly during a congressional hearing if the Federal Reserve would
monetize U.S. government debt) "The Federal Reserve will not monetize the
debt.”

The Ben Bernanke is a very smart man,
but pardon me if I don’t believe him when he says:(a) we’re not in an asset bubble, (b) there is
no inflation, and (c) the economy is looking pretty good (when we hit an all
time high for food stamp delivery last month).Or maybe I should just Google: “Goldman Sachs Fines” and see (on the
first page alone):

So, Mr. Collins, (short of visiting
a Chicago politicians meeting) can you find a more criminal group to recommend?But you are right about one thing, not
everyone is agog at this market run up. Anyone with a functioning brain
is not very excited about this recent market bubble because it isn’t based upon
growth or earnings or opportunity.A
stock that misses earnings, warns for the future, and lowers guidance is NOT a
reason for that stock to go higher.Every
bubble meets its pin. Tech hit it. Housing
hit it. Credit hit it. I get really scared when I hear The Ben
Bernanke say: "No fear, there's no bubble and if there was, I can let the
air out slowly."

The Market...

Every person that I talk to (who has
been in the business longer than 10 years, and doesn’t have an agenda to push)
believes that we have entered the end game.Thus far, in 2013, if you would have invested in the market on a Monday
and sold on a Tuesday you would have accumulated over 70% of the market’s
gains.There has not been a ‘down
Tuesday’ in 2013.Is it ‘normal’ that
Tuesdays and Fridays account for over 90% of the market gains in an entire
year?

As long as The Ben Bernanke, the ECB
and Japan are willing to print – then money will end up in the markets. A recent art auction at Christie’s broke
all-time records.Real estate (in
certain areas) is commanding all-time highs.The rich would rather get something for their dollars than watch them
inflate away. The stock market makes an all-time high, virtually every
day – with a 40-point drop being viewed as a "horrible correction".

But while prices of food, medical, education,
and clothing are rising considerably – elements like lumber (which is used to
build all the houses) are crashing. Iron
Ore is down 20% and in a bear market. Oil
is sloshing around everywhere, as there's no demand. And gold and silver (the two best metals to
offset currency devaluations) are falling.

I’ve seen this movie before.I continue to lean long into the market,
taking profits as I go.I am just about
to make another purchase of physical gold and silver. My guess is that since
the ‘safety stocks’ (that pay big dividends) have been played out, the
materials and cyclicals will become popular.If I’m right, names like CLF, JOY, UYM, and BAS should move. I'm getting
ready to push the ‘buy’ button on the miners – specifically the GDX and
GDXJ. The latest attack on gold and silver has pushed the miners to a
point where they're bordering on ridiculously cheap. When this particular attack is complete, I'm
buying both.I said a while ago that if
gold dropped into the high 1,200's and silver to 22, I would be a buyer of
the physical metals for delivery. Gold is getting there and silver is
already in the high 22's.

This summer, the market needs the
financials to pull it higher.Goldman
Sachs (GS) and JP Morgan (JPM) are setting up for breakouts. JPM’s breakout is around 50.45 with GS is around
157.00. If both break through those
levels and hold them for 2 days – we will NOT see a ‘Sell in May and Go Away’,
but rather a market that will drift higher through the summer.Right now GS (on Friday) hit 158.27, and JPM
hit 52.48.Watch over the next two days
to see if they can hold those levels.So
for this rally to really continue, JPM and GS need to hold their breakout levels.
If they fail, it could be the "one
thing" they use for a correction.

Tips:

We made some trades
this week.We sold out of SLB +$0.25, ANF + $1.25, CAT +$1.50,
and TJX +$1.50.

My currentshort-term holds are currently:

-GS – in
at 157.00 (currently 158.27) – stop at entry

-UA – in
at 60.19 (currently 62.34) – stop at entry

-SBUX –
in at 60.70 (currently 64.13) – stop at 63.00

-NSC –
in at 77.03 (currently 80.10) – stop at 78.25

-SIL – in at 24.51 (currently 12.84) – no stop yet

-GLD (ETF for Gold) – in at 158.28, (currently 131.46) – no stop
($1,364.90 per physical ounce), AND

Expressed thoughts
proffered within the BARRONS REPORT, a Private and free weekly economic
newsletter, are those of noted entrepreneur, professor and author, RF
Culbertson, contributing sources and those he interviews. You can learn more and get your free
subscription by visiting: <http://rfcfinancialnews.blogspot.com>
.

Please write to <rfc@getabby.com>
to inform me of any reproductions, including when and where copy will be
reproduced. You may use in complete form or, if quoting in brief, reference
<rfcfinancialnews.blogspot.com>.

If you'd like to view
RF's actual stock trades - and see more of my thoughts - please feel free to
sign up as a Twitter follower - "taylorpamm"
is my handle.

If you'd like to see
RF in action - teaching people about investing - please feel free to view the
TED talk that he gave on Fearless Investing:http://www.youtube.com/watch?v=K2Z9I_6ciH0

To unsubscribe please
refer to the bottom of the email.

Views expressed are
provided for information purposes only and should not be construed in any way
as an offer, an endorsement, or inducement to invest and is not in any way a
testimony of, or associated with Mr. Culbertson's other firms or
associations. Mr.
Culbertson and related parties are not registered and licensed brokers. This message may contain information
that is confidential or privileged and is intended only for the individual or
entity named above and does not constitute an offer for or advice about any
alternative investment product. Such advice can only be made when accompanied
by a prospectus or similar offering document. Past performance is not indicative of
future performance. Please make sure to review important disclosures at the end
of each article.

Note: Joining BARRONS
REPORT is not an offering for any investment. It represents only the opinions
of RF Culbertson and Associates.

PAST RESULTS ARE NOT
INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY
FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING ALTERNATIVE
INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS
INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT
PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME
REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY
CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE
INVESTMENT MANAGER.

Alternative investment
performance can be volatile. An investor could lose all or a substantial amount
of his or her investment. Often, alternative investment fund and account managers
have total trading authority over their funds or accounts; the use of a single
advisor applying generally similar trading programs could mean lack of
diversification and, consequently, higher risk. There is often no secondary
market for an investor's interest in alternative investments, and none is
expected to develop.

All material presented
herein is believed to be reliable but we cannot attest to its accuracy.
Opinions expressed in these reports may change without prior notice. Culbertson
and/or the staff may or may not have investments in any funds cited above.

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>
Until next week – be safe.

Sunday, May 12, 2013

First and most important – Happy
Mother’s Day. The job of being a mother
is the most important, and often the most underappreciated – and certainly
deserves its day of recognition!

Personally, the “Internet” has been
one of the single, biggest, “game changing” events that I have ever
witnessed. Then came the smart device –
for not only it’s informational abilities but also it’s GPS / locational
accuracy. But not long ago, a technology
morphed into something (that while not completely a stand-alone concept) is a
game changer. That technology is 3-D
printing. Basically what happens is that
you pour a powder into a machine, and then feed the machine's computer a 3-Dimensional
drawing. The computer then goes to work
"laying" that powder down in the same exact places that the drawing
says it should go. When a layer of the material
is laid down, a laser or a heat source hits the material and solidifies it. Then the machine makes the next pass over the
item, depositing more plastic or powder where it's supposed to go. Add another shot from the laser for
solidification, and so on. Layer by
layer a real 3-Dimensional, tangible item is produced.

In the beginning of its very short
history, 3-D printers were able to make simple things like toys, army men, and
game pieces. Then came the first
"wrench", and then onto the first moving parts like gears, cogs, cranks
and fan blades. Next medicine got
involved by creating model limbs, bones and jaws. In very rapid fashion the amount of things
that people were making were pretty amazing. But there was (and to some extent still is) a
problem. Most of the media used in the
process is some form of plastic. So even
a wrench made from your local 3-D printer, although it looks perfect, just can't
take the stresses of being used like a “Craftsman” wrench from Sears. The material just isn’t strong enough.

Now, let’s suppose there is a
material that will allow a dot matrix layering – that when heated (or lasered)
becomes as strong as steel. What if an
element like Graphene (or some alloy of it) makes things that are actually stronger
than steel? Suddenly the entire
manufacturing process for small items is completely disrupted. You would never need to go to a Home Depot
for a screw or a screwdriver again. Did
you break the wheel on your desk chair? Print
one. Do you need a new case for your iPhone?
Print one.

Well, the news was buzzing this week
about the 3-D gun that was successfully printed and fired. A handful of people were working on creating a
gun out of a printer that could hold up to the pressures created inside a gun when
the chamber is fired. Previously, the
plastic would fail due to those excessive pressures. Well, this week it
worked. A working, functional firearm was
created from nothing but plastic powder and a $2,000 printer. And then
the plans were put ‘on-line’ for the world to see and use. The plans were in a CAD (Computer-Aided
Design) format; therefore, anyone could take the plans, feed them into a 3-D
printer, and produce a functioning firearm. Now that’s a game changer in many ways.

Mayor Bloomberg (of New York City)
is currently pushing legislation through that would make it a crime to own a 3-D
printed gun. This week the State
department demanded that the plans be taken down (off the Internet). Factually – the plans have been downloaded
over 100,000 times and reside on servers all around the world, so the
technology and solution are out there. But
that isn't the real point. The point is
that as materials get stronger, anyone with a CAD program and a printer can (and
will) produce everything – even elements as sophisticated as a firearm.

3-D printing could truly be one of
the most disruptive technologies of our time.
Not only does it eliminate entire classes of machinists that turn metal
on lathes; it changes the entire landscape of small parts manufacturing. It (obviously) opens up a black market in the
weapons industry. While it might not be
feasible or economical to make many of the elements with these printers (even
if we had the ingredients that would work) – but there’s little doubt that 3-D
printing is a game changer! Linking this
to investments, look at companies that exist in the space like: DDD, XONE, and PRLB.

The Market:

Friday was a funny day. All day the averages seemed tired, and sorely
in need of a rest. But as usual, in the
last 40 minutes the buying started and pushed the averages up to end another
record week. I remember when setting a
record was exciting. Now that we set one
daily – it’s becoming mundane.

So the music is still playing and there
are still musical chairs available on the deck of the Titanic. How long this can last is anyone's
guess. But it seems to me that when they do decide to yank the rug on the
government funding, it's going to be faster and sharper than most will imagine.

I sold some half positions on
Friday. We had really nice short-term
gains on several names and I wanted to lock in some of that profit. By selling half positions, I get to lock in a
good gain, but still keep some “skin in the game”. While I'm not against
picking up more stocks if they look ready to make a move, let's all remember
we're in a bubble, and bubbles are irrational.

In the meantime, gold was beaten
down again – but the attempt wasn’t nearly as successful as it was a few weeks
back. While it was down $50/ounce at
mid-day, it rallied back to close down just $24/ounce. I see signs that ‘potentially’ they're going
to let gold and silver run a bit here. If
that's correct, we'll want to jump on some gold and silver stock plays.
ABX over $22 sounds reasonable as a decent short-term trade.

I received some emails asking about
"penny" stocks. I don't really
play penny stocks – simply due to the risk involved. While I may dream of buying a stock at 70
cents and having it go to $20, the number of them that actually do – is pretty
small. More times than not, the penny
stocks are the domain of the day-traders – the gents that buy 20K shares at 10
am and sell them at 10:50 for a two cent gain. Normally my investing line
is $5, but (I must admit) when I first bought SLW it was $3 and ended at $46 –
so there are exceptions to every rule.

If you’re into penny stocks, look at
MJNA. It’s a ‘medical marijuana’ stock
that ran from 4 cents to 35 cents recently.
I honestly find picking penny stocks a ‘stretch’ for my skill set. For example: There is a tiny company with the
ticker symbol APDN, trading around 20 cents.
They have a very interesting security application that marks elements
for identification using your DNA. Your
DNA is unique, and therefore if your Rolex watch gets stolen – your DNA could
identify it as being yours. In Europe,
where all the exit doors of jewelry exchanges have "DNA Sprays" above
them, it works very nicely. And, in the
stores that use it, crime has become "non existent". But
guessing whether a company like that could make the same impact over in the US
– that’s beyond my comfort level.

A shout out to DS a reader that
introduced us to the following chart for Median Household Income – showing a
steady decline from 2000 thru 2013:

We learned last week
that the average workweek declined in the number of hours worked, and it was
the largest decline since April 2009.
Often companies reduce hours at the early stages of economic
contractions, prior to laying-off workers.
Not to mention that the quality of the jobs created by this economy
continues to be horrible. At the current
rate, the majority of Americans are going to be tending bar, waiting tables or
holding multiple temp jobs to make ends meet.
Salaried positions with benefits are becoming a dying breed. Even the banks, which are the recipients of
the Fed's generosity, are laying-off workers – such as JP Morgan just shedding
17,000 positions.

Unfortunately, wealth
disparity (which has grown demonstrably over the past decade) is distorting the
personal income figures that are often used to measure the health of the US
economy. As shown above, the median
family income has declined over the past 10 years. Median household income declined 1.1% in
the month of February, and it is down 5.6% since the recovery began in June
2009. So the devil is (once again) in
the details.

Tips:

We made some trades
this week and our short-term account is listed below.

My currentshort-term holds are currently:

-ANF –
in at 52.59 (currently 53.84) – stop at 53.10

-CAT –
in at 87.12 (currently 88.62) – stop at 88.25

-SBUX –
in at 60.70 (currently 63.09) – stop at 62.00

-TJX –
in at 48.77 (currently 50.95) – stop at 49.25

-NSC –
in at 77.03 (currently 79.01) – stop at 77.90

-SLB –
in at 75.18 (currently 76.29) – stop at 75.20

-SIL – in at 24.51 (currently 14.30) – no stop yet

-GLD (ETF for Gold) – in at 158.28, (currently 139.96) – no stop
($1,436.80 per physical ounce), AND

Expressed thoughts
proffered within the BARRONS REPORT, a Private and free weekly economic
newsletter, are those of noted entrepreneur, professor and author, RF
Culbertson, contributing sources and those he interviews. You can learn more and get your free
subscription by visiting: <http://rfcfinancialnews.blogspot.com>
.

Please write to <rfc@getabby.com>
to inform me of any reproductions, including when and where copy will be
reproduced. You may use in complete form or, if quoting in brief, reference
<rfcfinancialnews.blogspot.com>.

If you'd like to view
RF's actual stock trades - and see more of my thoughts - please feel free to
sign up as a Twitter follower - "taylorpamm"
is my handle.

If you'd like to see
RF in action - teaching people about investing - please feel free to view the
TED talk that he gave on Fearless Investing:http://www.youtube.com/watch?v=K2Z9I_6ciH0

To unsubscribe please
refer to the bottom of the email.

Views expressed are
provided for information purposes only and should not be construed in any way
as an offer, an endorsement, or inducement to invest and is not in any way a
testimony of, or associated with Mr. Culbertson's other firms or
associations. Mr.
Culbertson and related parties are not registered and licensed brokers. This message may contain information
that is confidential or privileged and is intended only for the individual or
entity named above and does not constitute an offer for or advice about any
alternative investment product. Such advice can only be made when accompanied by
a prospectus or similar offering document. Past performance is not indicative of
future performance. Please make sure to review important disclosures at the end
of each article.

Note: Joining BARRONS
REPORT is not an offering for any investment. It represents only the opinions
of RF Culbertson and Associates.

PAST RESULTS ARE NOT
INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY
FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING ALTERNATIVE
INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS
INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT
PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME
REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY
CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE
INVESTMENT MANAGER.

Alternative investment
performance can be volatile. An investor could lose all or a substantial amount
of his or her investment. Often, alternative investment fund and account
managers have total trading authority over their funds or accounts; the use of
a single advisor applying generally similar trading programs could mean lack of
diversification and, consequently, higher risk. There is often no secondary
market for an investor's interest in alternative investments, and none is
expected to develop.

All material presented
herein is believed to be reliable but we cannot attest to its accuracy.
Opinions expressed in these reports may change without prior notice. Culbertson
and/or the staff may or may not have investments in any funds cited above.

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>
Until next week – be safe.

GetAbby.com IVR Solutions

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